JAKARTA — Anthoni Salim, CEO of Indonesian conglomerate Salim Group, has raised his stake in Data Center Indonesia by an additional 1.02 trillion rupiah ($71 million) as competition heats up in the country’s cloud space on the heels of recent announcements by Tencent and Microsoft.
With the increased personal stake, Salim now directly controls 11.12% of shares in the local cloud services operator, up from 3.03% before the transaction, DCI said in a filing to the Indonesia Stock Exchange on Thursday. The company’s share price rose 20% to 19,800 rupiah in same-day trading following the announcement, and jumped a further 20% to 23,750 rupiah on Friday morning.
Last week, DCI inaugurated its fourth data center facility in Bekasi, an industrial town east of Jakarta, increasing total capacity to 37 megawatts. The company said it has enlisted three “top global cloud service providers” and the seven “biggest e-commerce platforms in Indonesia [and] Southeast Asia” among its clients, as well as more than 100 financial services providers and 30 telecommunications companies.
DCI, which opened its first data center in 2013, said it aims to build as many as 15 such facilities in Southeast Asia’s largest economy with a total power capacity of 200 MW.
Indonesia is one of the hottest battlegrounds for cloud services in Asia, pushing up demand for local data centers owing to its expanding digital economy supported by the world’s fourth-largest population, a vibrant democracy, internet-savvy youth demographic and a welcoming regulatory environment. Online services such as e-commerce, video conferencing, streaming and gaming have enjoyed a further boost during the coronavirus pandemic.
A report released in January by Google, Temasek and Bain & Company projected that Indonesia’s internet economy grew 11% to $44 billion last year and will further expand 23% annually to reach $124 billion in 2025.
Salim’s move follows Chinese internet conglomerate Tencent Holdings’ announcement in April of a plan to open two data centers in Indonesia by the end of the year. Earlier in February, U.S. tech giant Microsoft reiterated its plan to establish its first data center in the country.
Chinese internet giant Alibaba, through its cloud arm Alibaba Cloud, currently runs two data centers in Indonesia and said it was planning to launch a third this year. Amazon, through Amazon Web Services, also has mentioned a plan to build a data center, while Google last year localized its cloud services for Indonesian clients by partnering with local data center operators after previously using overseas centers.
DCI, founded and led by Otto Toto Sugiri, a former IT manager at a local bank, has seen its business grow sharply during the COVID crisis. It posted 55% revenue growth to 759.4 billion rupiah last year, while net profit surged 71% to 183 billion rupiah. In the first three months of this year, revenue and net profit rose 25% and 55%, respectively, to 171.5 billion rupiah and 48 billion rupiah.
The company’s share price has multiplied 45 times since going public in January.
Salim’s increased stake in DCI marks a deeper foray by the Salim Group — best known for its instant noodle producing unit Indofood — into the burgeoning digital economy. He also personally owns a stake in Indonesian multimedia company Elang Mahkota Teknologi, which has invested in local e-commerce unicorn Bukalapak and digital wallet Dana.
His son, Axton Salim, is involved in startup incubator Block 71, which has offices in Jakarta and Singapore, and also in local e-sport development.
